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15% Increase in Natural Gas Prices

Gas prices have increased 15 percent for household, commercial, and public sectors, Fars news agency quoted managing director of the National Iranian Gas Company (NIGC) as saying Tuesday.

The law stipulating 15 percent increase in gas prices will go into effect as of Wednesday, May 26, Hamidreza Araghi said. Gas prices for industries, petrochemical complexes, agricultural and animal husbandry sectors will remain unchanged. Since natural gas comprises more than 70 percent of the country's energy basket, the government refrained from raising prices "to a great extent," Araghi added. Prices for household consumers are categorized into summer and winter prices to be applied in the first and the second half of the year.

For the first half of the year, a cap of 1,500 rials ($0.04) per cubic meter of gas was previously stipulated. With the recent 15 percent increase, prices have surpassed the specified cap, and therefore, the government is obligated to charge no more than 1,500 rials for household consumers in the first half of the year.

Natural gas in Iran is still among the cheapest in the world. Iran holds the world’s second biggest natural gas reserves after Russia, which accounts for 17 percent of the world's proved natural gas reserves.